Industry News

Wells Fargo scandal cost the bank another 225 reps

The fallout surrounding Wells Fargo & Co.’s infamous practice of opening checking and credit accounts that customers didn’t…

The fallout surrounding Wells Fargo & Co.’s infamous practice of opening checking and credit accounts that customers didn’t know about continues to hurt the bank’s reputation, but apparently not it’s bottom line.

The first-quarter earnings report, released Thursday morning, showed that 225 of the bank’s brokerage reps left during the quarter, dropping the total headcount to 14,657.

The departures during the quarter ending March 31 followed a 204-broker reduction in the previous quarter.

Last Fall, Wells Fargo was fined $185 million after it was learned that its retail banking business was opening multiple client accounts on their behalf, and without their knowledge.

Overall, the quarterly statement showed net income of $5.5 billion on $22 billion in revenue, both figures are up slightly from the prior quarter and essentially in line with the same quarter last year.

On the bank’s retail brokerage side, despite losing more than 400 reps over the past six months, advisory assets climbed by 6% over the prior quarter to$490 billion, which also reflects a 14% gain over the same quarter last year.

Client brokerage assets climbed by 10% during the quarter to $1.6 trillion.

“Wells Fargo continued to make meaningful progress in the first quarter in rebuilding trust with customers and other important stakeholders, while producing solid financial results,” said Well Fargo chief executive officer Tim Sloan in the earnings report.

“We have taken significant actions throughout the company to date and we are committed to building a better bank as we move Wells Fargo forward,” he added, referencing a recent report by the independent directors of the Wells Fargo board regarding an investigation into the company’s retail banking sales practices.

“The findings are valuable to us and beneficial in helping to identify areas for further improvement,” Mr. Sloan said. “While we have more work do to, I am pleased with all we have accomplished thus far.”